Investing.com -- The S&P 500's latest quarterly earnings season has been "mildly disappointing" so far, according to analysts at RBC Capital Markets.
In a note to clients published on Monday, the analysts that, roughly a third of the way through the batch of three-month returns, the percent of companies in the benchmark index beating Wall Street estimates is tracking below the levels of the prior quarter.
According to their estimates, 76% of firms have posted profits above expectations, down from 80% in the second quarter, and 58% have topped sales projections, under the previous mark of 61%.
Meanwhile, the rate of upward income estimate revisions to sell-side consensus forecasts "continues to indicate that a modest downward revision bias is still in place," the analysts also noted.
On earnings calls, executives have presented a "mixed" assessment of the overall outlook and economic backdrop, they added. Those with a more positive tone have cited more optimism around topics like the impact of lower interest rates and broader economic resilience, while other management teams have flagged worries over sluggish demand and reluctant consumer spending habits, the analysts' research showed.
"Though the macro color has been mixed for several quarters, we nevertheless exited last week feeling as though the tone was a bit more negative than usual, which we admit may be a function of all of the Industrial companies that we read," the analysts said.
The comments come ahead of the release of a string of quarterly returns from tech industry titans that could heavily influence the direction of markets.
Although shares in industrial and financial firms have recently helped broaden out the gains in the stocks, the biggest tech players have been the most powerful drivers of a push higher in stock markets to record levels. The so-called Magnificent Seven tech groups are tipped to account for almost all of the earnings growth from the S&P 500 in the third quarter, according to FactSet data cited by The Wall Street Journal.
Meanwhile, commentary from these groups around artificial intelligence could sway how analysts are assessing a spike in investment in the nascent technology, with some strategists worrying that the heavy spending may not lead to immediate returns.
Of the Magnificent Seven firms, Google-parent Alphabet (NASDAQ:GOOGL), software giant Microsoft (NASDAQ:MSFT), Instagram-owner Meta Platforms (NASDAQ:META), iPhone-maker Apple (NASDAQ:AAPL) and e-commerce behemoth Amazon (NASDAQ:AMZN) are all due to report this week. Electric carmaker Tesla (NASDAQ:TSLA) posted better-than-expected earnings last week, while AI-darling Nvidia (NASDAQ:NVDA) is set to unveil its latest figures on Nov. 20.